Finding E-commerce Success through Subscription Services

‍1 Introduction

In today’s fast-evolving e-commerce world, subscription models are becoming a go-to strategy for businesses looking to build long-term relationships with customers and generate predictable revenue. Whether you’re offering curated boxes or automatic product replenishments, the subscription approach is transforming how companies engage with consumers.

1.1 Why Implement a Subscription Model?

Subscription models provide a win-win: businesses benefit from a steady revenue stream, while customers enjoy convenience and personalised experiences. For e-commerce companies, subscriptions simplify the purchasing process, increase customer loyalty, and boost lifetime value (CLV).

1.2 Types of Subscription Models

Understanding the types of subscription models can help tailor your offering to your audience:

• Replenishment: Automate the delivery of essential items like toiletries or pet supplies.
• Curation: Offer curated boxes tailored to customer preferences (e.g., fashion, beauty).
• Access: Provide exclusive discounts, early releases, or member-only content.

‍2 Examples of Brands Excelling in Subscriptions

2.1 Tropic Skincare 

Tropic Skincare offers a flexible subscription service for their natural, eco-friendly beauty and skincare products. Customers can subscribe to have their favourite products, such as cleansers, serums, and moisturisers, delivered automatically at intervals that suit them—typically every 4, 6, or 8 weeks. Some key aspects of the Tropic subscription include:

• customisation: Subscribers can choose the frequency and combination of products, ensuring they never run out of their favourites.
• Sustainability: The brand emphasises eco-friendly packaging and refills, aligning with its commitment to sustainability.
• Rewards and Discounts: Tropic offers special discounts for subscribers, plus incentives for bundling products together in a subscription.
• Cancel Anytime: The subscription service is designed to be flexible, allowing users to pause, modify, or cancel their subscriptions at any time without penalty.

Tropic’s focus on sustainability and convenience has helped build a loyal customer base, especially among those who value eco-conscious beauty.

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2.2 Neal’s Yard Remedies 

Neal’s Yard Remedies is known for its organic and ethical beauty and wellness products, and it has embraced subscription services that cater to customer convenience and environmental mindfulness. The Neal’s Yard subscription includes:

• Regular Deliveries: Customers can subscribe to have their essential skincare or aromatherapy products delivered every month, ensuring they don’t run out.
• Loyalty Program Integration: Subscribers earn points on every order, which can be redeemed for future discounts, enhancing the appeal for repeat purchases.
• Ethical and Organic Focus: Neal’s Yard emphasises sustainability in its subscription services, using packaging that aligns with its environmental values, including options for refills that reduce waste.
• customisable: Subscribers can adjust the frequency or the specific products they receive, providing a tailored beauty experience.

The brand’s subscription model is particularly popular among customers who prioritise organic, sustainable beauty and holistic wellness solutions.

2.3 Molton Brown 

Molton Brown, renowned for its luxury bath, body, and fragrance products, offers a subscription service that caters to those who want a consistent supply of their favourite premium products. The key elements of the Molton Brown subscription include:

• Convenience: Customers can sign up for recurring deliveries of their preferred luxury products, such as body washes, hand lotions, or candles. The service ensures they never run out of high-end essentials.
• Personalization: Subscribers can choose from a range of products and set delivery frequencies that suit their needs. This allows them to tailor their subscription to their lifestyle and preferences.
• Exclusive Benefits: In addition to the convenience of automated deliveries, Molton Brown subscribers often receive exclusive discounts, early access to new product launches, and special gifts with their orders.
• Sustainability Options: Like other leading beauty brands, Molton Brown is beginning to introduce more environmentally friendly practices, including refillable product options, which may extend into their subscription services.

This service is perfect for customers who want to maintain a luxurious routine with minimal effort, while also enjoying the perks that come with being a regular subscriber.

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All three brands leverage personalization, sustainability, and flexibility in their subscription models, making them appealing to modern consumers who prioritise convenience and environmental consciousness.

3 Mini Guide to Implementing Subscription Models

In this section, we explore some areas to consider when you are getting ready to roll out your chosen subscription model. Below is a mini how-to guide to getting started and we will explore these areas in more detail in future blogs.

3.1 Platform Consideration 

Your subscription strategy and chosen model may vary depending on the platform that you are on. Here we cover platforms like Shopify and Bigcommerce, however,  feel free to get in touch with us if you would like advice around a different platform not mentioned below.

Shopify 

Shopify offers several options to integrate subscription models into your e-commerce business through various apps:

1. Appstle: A powerful app that allows businesses to set up recurring billing for products, making it ideal for replenishment models (e.g., food, toiletries).
2. smile.io: Smile.io helps e-commerce businesses create and manage loyalty programs to boost customer retention and engagement. It offers customisable rewards systems, including points, VIP tiers, and referral programs, to incentivise repeat purchases. Integrated with platforms like Shopify, it enhances brand loyalty through personalized rewards and seamless user experiences.
3.  Shopify’s Subscription APIs  Shopify itself does not have an entirely built-in subscription service, but it provides the foundational Subscription APIs that allow merchants to implement subscription features with minimal third-party involvement. However, if you're just starting out and do not have the budget to invest in premium apps mentioned above,, there are some lower-cost or free solutions that can help you set up basic subscriptions. More information can be found here

BigCommerce 

BigCommerce also supports subscription models through integrations with apps such as:

1. ReCharge: Like its Shopify counterpart, ReCharge for BigCommerce allows businesses to offer recurring billing for subscription-based products.  The app is highly praised for its intuitive interface and excellent customer support, making it a reliable choice for scaling subscription-based businesses and enhancing customer lifetime value.
2. Rebillia: Offers flexible subscription management, including payment updates, cancellations, and renewals, giving customers more control over their subscriptions.
3. PayWhirl: Simplifies recurring payments and customer management, making it easy to add subscriptions to your store.

Each platform allows for customisable subscriptions, ensuring you can meet the needs of various customer segments.

3.2 Creating a Customer-Friendly Subscription Experience

Creating a customer-friendly subscription experience is crucial for online retailers, especially in today’s competitive market where convenience, personalization, and customer retention are key drivers. Here's how you can create a seamless and appealing subscription model for your online retail business:

A smooth customer experience is key to maintaining subscriptions:

Flexibility

Customers appreciate flexibility when it comes to subscription services. To ensure your subscription offering is customer-friendly:

• Variety of Plans: Provide multiple subscription options (monthly, bi-monthly, or quarterly) to accommodate different customer needs.
• Pause or Cancel Easily: Allow subscribers to easily pause, skip, or cancel their subscription without hassle. This creates a sense of control and minimises frustration when customers need a break or don’t want a specific shipment.
• customisable Products: Let customers choose the products they receive, or at least curate selections based on their preferences. This could be as simple as letting them select specific items within a bundle or offering a “build-your-own” subscription box.

Personalised Experience

Personalization is key in creating a customer-friendly subscription experience. You can implement:

• Tailored Recommendations: Use customer data to suggest products based on their purchase history, preferences, or behaviour. This increases engagement and satisfaction as customers feel that the subscription is customised to their needs.
• Onboarding Surveys: When customers first sign up, ask them to complete a short quiz or survey to gather information about their preferences, so you can offer more personalised recommendations right from the start.
• Regular Check-Ins: Periodically ask subscribers if their preferences have changed and adjust their subscription accordingly. This can be done through emails or via a user-friendly dashboard.

Simplify Subscription Management

One of the top reasons customers churn from subscription services is difficulty in managing their subscription. To avoid this:

• Intuitive User Interface: Create an easy-to-navigate online platform where customers can manage their subscriptions, including updating payment information, changing delivery dates, and viewing upcoming orders.
• Automated Alerts: Send timely notifications about upcoming shipments, billing reminders, or low-stock warnings. This transparency keeps customers in the loop and gives them time to make adjustments if necessary.

Incentivise Subscriptions

To encourage sign-ups and retain subscribers, offer incentives that reward loyalty:

• Discounts for Subscribers: Provide a discount on recurring purchases versus one-time buys. Many businesses offer 10-20% off for subscribers, making it a compelling financial incentive.
• Exclusive Perks: Offer access to exclusive products, early product launches, or special gifts for subscribers only. This creates a sense of exclusivity and added value.
• Loyalty Programs: Integrate a rewards program where subscribers earn points on each order, which they can redeem for free products, discounts, or special services.

Ensure Seamless Logistics and Delivery

A smooth delivery process is vital for a positive subscription experience. To achieve this:

• Reliable Shipping: Partner with trustworthy shipping services to ensure that deliveries are timely and predictable.
• Tracking Information: Always provide customers with detailed tracking information and delivery estimates.
• Eco-Friendly Packaging: More customers today are environmentally conscious, so offering sustainable packaging (like recycled or refillable containers) can enhance the customer experience and align with modern values.

Create Engaging Content and Community

Subscriptions thrive on customer engagement. Consider:

• Exclusive Content: Provide value-added content, such as how-to guides, tips for using your products, or access to expert advice. This can be delivered through emails, blogs, or video content.
• Foster a Community: Build a community around your subscription through social media groups or forums where customers can share their experiences, ask questions, and engage with your brand. This deepens the connection and helps build loyalty.
• Surprise and Delight: Occasionally surprise your subscribers with unexpected gifts or product samples. This makes the experience feel more personalised and exciting, reducing the chances of them cancelling.

3.3 Selecting the Right Payment Gateway

An essential part of subscription success is reliable recurring billing. Choose gateways like Stripe or PayPal that offer features such as:

• Support for recurring billing.
• Failed payment management and tools for updating payment information.

3.4 Pricing Strategies for Subscriptions

Maximising profit means setting the right pricing strategy:

• Tiered Pricing: Encourage customers to commit to longer subscriptions by offering discounted rates for quarterly or annual plans.
• Trial Offers: Attract new customers by offering discounted or free first-month subscriptions, creating low-risk opportunities for them to try your service.

3.4 Marketing and Customer Acquisition

Attracting subscribers requires a well-planned marketing strategy:

• Exclusive Discounts: Offer time-limited deals to drive sign-ups.
• Email Marketing: Use emails for upselling or cross-selling to existing subscribers.
• Social Media: Share customer testimonials and unboxing experiences to build buzz around your brand.

3.5 Managing Churn and Retention

Retention is the key to subscription success. To reduce churn:

• Personalise experiences through tailored recommendations and offers.
• Send reminder emails before renewals or changes, and collect customer feedback regularly.
• Retarget customers who cancel or abandon subscriptions with special offers to win them back.

3.6 Legal Considerations

When implementing subscriptions, transparency is critical. Ensure clear terms of service, especially around billing, refund, and cancellation policies. Customers should always know what they’re signing up for.

4 Measuring The Success of Your Subscription Business

4.1 Essential Metrics to Track for Subscription Growth

Tracking the right metrics is key to understanding and optimising your subscription business. Here are the most crucial ones:

• Customer Lifetime Value (CLV): CLV measures the total revenue you can expect from a single customer over their subscription lifespan. A higher CLV indicates long-term loyalty and higher profitability. Tracking CLV helps inform decisions on marketing spend, customer acquisition strategies, and upselling potential.
• Churn Rate: Churn rate represents the percentage of subscribers who cancel during a given period. By analysing churn, you can identify the reasons behind customer attrition—whether it's pricing, service quality, or unmet expectations. Reducing churn is vital for sustained growth.
• Subscription Renewal Rates: This metric tracks how frequently subscribers renew their plans. High renewal rates indicate satisfied customers, while low rates suggest issues with value perception or competition. Monitoring renewal rates helps optimise retention strategies, such as personalised offers or improved communication.

4.2 Test and Optimise

Finally, continuously improve your subscription service by:

• A/B Testing: Experiment with different pricing models, product offerings, and promotional tactics to see what resonates best with your audience.
• Gather Feedback: Regularly ask subscribers for feedback on their experience and use that data to optimise your offering. For instance, if customers express a desire for more flexibility or different shipping options, be responsive and make adjustments.

By understanding these key metrics, you can continually optimise your subscription model for better growth, customer retention, and overall profitability.

5 Conclusion

Subscription models offer a powerful way to build lasting relationships and create predictable revenue streams. By focusing on customer satisfaction, personalising experiences, and leveraging analytics, businesses can scale their subscription models effectively. Now’s the time to integrate subscription strategies into your e-commerce business for long-term success.

GPMD Examples

River Cafe  - Olive Oil Subscription with Appstl -Product Link

The River Cafe wanted to offer their customer the option to purchase and gift a subscription of olive oil just in time for the Christmas gifting season. Their custom requirements specified we needed a tool that would allow us to set up the subscription on a product and for customers being able to pre-pay for 12 months worth of product that could be shipped directly to their giftee.

Appstle’s extensive customisability allowed us to not only create a set term subscription of 12 months but also default it to be pre-paid to avoid churn and ensure the gifting would not expire due to card issues in future. We integrated a 6 and 12 months option for customers to choose from which showcases their overall savings. Customers can purchase easily and should they wish to in future manage this subscription directly from their Native Shopify Account pages.

Butterflies HealthCare - Subscription with Appstle - Product Link

Eye Health retailer Butterflies Eyecare wanted to migrate from a manual subscription model that required their team to manage direct debits and keep track of their subscriptions manually to something that would allow them to automate the process and ensure customers received the products they needed and loved on a regular basis. 

We installed and customised the subscription offering from Appstle and used its custom subscription settings to to customise different offerings to thor products. As they offer supplements that contain differing amounts of product we were able to create subscriptions and their relevant terms for products that could be received monthly or quarterly without any conflicts. We integrated the required subscription plans smoothly over the period of a few weeks while the client migrated their existing direct debit subscription. Initially limited to a set number of products the subscription will roll out to the wide range of supplements available to purchase in the near future.